New York New York Estate Planning, Probate and Living Trusts Attorneys The Khalsa Law Firm

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Taxpayers Fight and Win State Estate Tax Battles
In 2001, the federal government passed the Economic Growth and Tax Reform Reconciliation Act of 2001 (“EGTRRA”). One of the provisions of EGTRRA was the gradual reduction and then elimination (in 2004) of the state death tax credit on the federal estate tax return. About three-quarters of the states limited the amount of the death taxes they received to the amount of the state death credit. With the reduction in the credit, these “pick-up” states started to see their tax revenues decline and as a result about one-third of them “decoupled” from the federal system. The decoupling states implemented their own estate tax regime based on federal law that was in existence prior to EGTRRA. In some circumstances this resulted in taxpayers paying a higher combined federal and state estate tax than they would have paid under the law before the enactment of EGTRRA, even though EGTRRA was heavily promoted as a tax reduction.

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The Khalsa Law Firm Office Locations Estate Planning Attorneys for New York, NY
FOR CORRESPONDENCE NEW YORK 440 East 23rd Street Suite 9F New York, NY 10010 Phone: (212) 529-4560 Fax: (212) 529-5241 CONTACT US	FOR MEETINGS NEW YORK 200 Madison Avenue, Suite 1901 (between 35th & 36th) New York, NY 10016 Phone: (212) 529-4560 CONTACT US See a map to this office!